On Thursday, February 22, 2024, Reddit filed documents that will allow the social media platform to go public. This would represent the first major social media public listing since 2019.
Reddit was founded in 2005 by University of Virginia roommates Steve Huffman and Alexis Ohanian, as well as the late Aaron Schwartz. The social media site operates as a social news aggregator, content rating and forum social network. Reddit was the 18th most-visited website in the world as at October 2023. Nearly half of the website’s traffic comes from the United States, with Canada and the United Kingdom making up nearly 15% of users. That means there is tremendous room for growth beyond the anglosphere on Reddit.
In its offering prospectus, Reddit disclosed its financial performance. The company reported that revenues climbed 20% year-over-year while its losses narrowed. Meanwhile, it boasted that it had added 73 million daily users over more than 100,000 active communities.
Reddit hopes to lure investors with the prospectus as the stock could go public in the matter of a few weeks on the New York Stock Exchange. It will use the symbol RDDT and boast a valuation of roughly $5 billion. That is half the $10 billion valuation that the company received in a private financing round back in 2021.
Investors will want to watch this IPO closely as social media companies have come under scrutiny following political turmoil in the late 2010s and the COVID-19 pandemic. Reddit will look to emulate the performance of Facebook and avoid the pitfalls that led to trouble for Twitter and Snap in recent years.
